How to Start a Small Business from Home Selling Customer Returns Online

Buying wholesale merchandise and selling it online from your own home can be a very rewarding way of making some extra money. If things go really well, it might just turn into a full-blown business with customers all around the world. But what do you need to consider, If you’re interested in starting a small business selling from home?

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First of all, you’re going to need to get your stock from the best, most reliable and cheapest place you can. For many startups, that doesn’t mean sourcing from a local wholesaler who will charge you a premium, may well mislead you about the quality of goods on offer and will often charge you pretty much full retail price for what should be wholesale goods.

Rather, the best place to source wholesale merchandise is from an online liquidation marketplace such as the one operated by Direct Liquidation. It’s there you’ll find top-quality customer returns being sold at prices you won’t find anywhere else.

What Is An Online Liquidation Marketplace?

Unlike traditional wholesalers or smaller-scale liquidation companies, a top-tier liquidation specialist such as Direct Liquidation deals directly with major national retailers like Amazon, Target and Walmart.

Every year, these giants of the retail world take back hundreds and hundreds of products for a variety of reasons ranging from them not working, to customers simply changing their minds about their purchases. These customer returns are no longer classified as new stock, regardless of the fact that they quite often are, and are thus of no interest to the national retailers who are, after all, not discounters or second hand stores.

This is where top-tier liquidation specialists step in. They offer national retailers spaces on their online liquidation marketplaces via which the national retailers can sell their unwanted returns direct to reselling businesses. And because the national retailers wish to dispose of their returns as quickly as possible to free up valuable warehouse space, they’re happy to lower their expectations and accept prices on this type of stock that they wouldn’t accept under normal circumstances. The wholesale merchandise that can be found on an online liquidations marketplace is priced well below its MSRP value, meaning resellers will find themselves with plenty of room to make a healthy profit on merchandise sourced this way.

Starting A Small Business Home Selling Returns

If you’re interested in starting a small business home selling customer returns online, there are a few things you’ll need to do and be aware of.

First Things First

First of all, you need to figure out what type of online resale business you want to start up. The online retail sector is a crowded marketplace, so it’s vitally important that you find a niche that’s suited to you and that you know you can compete in. For example, you may be a bit of a tech whizz with an aptitude for repairs. If that’s the case, buying and reselling electronics wholesale could be for you. Not only will you know the market and what customers are clamoring for, you’ll also be able to bring your repair skills to bear.

Typically, a small amount of the merchandise in an average pallet of wholesale electronics will contain so-called ‘tested-not-working’ products. With your repair skills, you can bring some of these items back up to factory spec, thus increasing the amount you can make on a pallet of returns bought from a liquidator.

That’s just one example. Remember – when setting up a wholesale reselling business, bringing your own skills, interests and knowledge into play is one of the best ways you can make a success of your business.

Budget

Once you’ve decided what type of reselling business you wish to set up, you need to come up with a budget. You’ll need stock, of course, but that isn’t the only financial outlay you’ll have to take into consideration.

You’ll have to take into account such factors as the shipping costs you’ll have to pay when buying wholesale merchandise from a liquidator, what sales taxes you might be liable for (typically, resellers can apply for exemption from these taxes, but you must find out if you’re entitled to these exemptions in your home state), what you’re prepared to pay on marketing and whether you need to pay for storage or not.

Storage

In the case of storage, this very much depends on how big you want your business to be. If you’re just starting out, you may have a garage or spare room in which to store the wholesale merchandise you order. If not, you’ll have to factor in how much of your budget will be spent hiring storage space.

If you’re worried about storage, don’t forget that Direct Liquidation also sells boxes of returns on behalf of its partners, such as Amazon returns boxes. So, if you are squeezed for space, this might be your best option.

Buying Liquidated Customer Returns

Once you’ve set your budget and decided what type of stock you wish to specialize in selling, you will, of course, need some stock to sell. Direct Liquidation’s partner retailers offer a huge range of customer returns in categories ranging from the latest consumer tech, men’s, women’s and children’s fashions and accessories and toys and games, to home improvement products, outdoor equipment and office supplies.

Whatever business you decide to set up, you’ll likely find a box, pallet or even truckload of customer returns that’s right for your business. So it’s worth checking out Direct Liquidation’s Amazon, Lowe’s Hardware, Walmart and Target vendor landing pages to see what’s on offer, as well as more general liquidation wholesale lots that are also sold via the platform.

Once you’ve identified a box, pallet or truckload you’re interested in, you have several options. You can bid for the merchandise you’re interested in via live liquidation auction, you can usually buy the merchandise at a fixed price, or you can make the liquidator an offer that, if acceptable to the liquidator, will be the price you pay. This means you have a level of flexibility when making purchases from an online liquidation marketplace not available elsewhere, from bidding at auction to getting a box, pallet or truckload in a hurry by buying at a fixed price. The choice is yours.

Shipping

As we’ve previously mentioned, you’ll have to factor in shipping costs when making budget and profit calculations. Unless the liquidator’s distribution center is both local and allows customer pickup, shipping costs will be unavoidable. A lot of customers choose to hire a third-party courier to ship goods from the liquidator to their front door, but this might not always be the most cost-effective way to receive your goods.

It’s worth checking with the liquidator to see how much it will cost to let them handle the shipping. Often, thanks to the discounts liquidators have secured with their courier partners, it’s actually cheaper to let the liquidator handle the logistics than it is to hire a third party. So always check what the liquidator can do for you as your startup may save money this way.

Selling / Marketing

Finally, once you’ve received the merchandise from a top-tier liquidation specialist such as Direct Liquidation, it’s time to get selling. Most people think the best way to start selling to customers is to open up a store on Amazon or eBay. While these are both fantastic outlets, they’re also very crowded marketplaces and it can be a struggle for a startup to get noticed at first. Plus, both expect a financial outlay that will eat into what can often be quite a small starting budget.

So, before leaping into the vast ocean that is Amazon and eBay, it’s advisable to start small and start local. Craigslist and local online directories are great ways to advertise your wares locally, and the fact most customers will pick up their purchases directly from you means you’ll keep shipping costs to a bare minimum while at the same time building up a loyal local customer base.

If you really want your own online store, it’s worth checking out some of the smaller store-hosting sites such as Wix and Shopify. Unlike the bigger online hosts, sites like Shopify offer free trials to new customers, which means you can test if sites like these are the right fit for your business without the need to lay out anything up front.

Finally, there’s marketing. There’s no point in having a pallet of great-quality wholesale liquidation stock if nobody knows about it. For a small charge, Facebook targeted ads can reach exactly the customers you’re looking for without breaking the bank. Indeed, social media as a whole is a great tool to spread the word about your business. Instagram is a great way to show off what you’ve got to offer, Facebook Marketplace reaches a huge number of potential customers and Twitter is the place to tell people what you’re selling. In this Internet-savvy age, you ignore social media at your peril, so learn to use it to your advantage.

Hopefully, you’ll now be equipped with all you need to know to start your own wholesale business home selling customer returns online. We wish you luck with your new business venture, and we’re always here to help.

Direct Liquidation is a goTRG company.

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Henley Johnson

Henley currently works as a sales representative for Direct Liquidation, assisting businesses with product sourcing of liquidated merchandise from the largest retailers in the world. Whether you are looking for a pallet or a truckload Henley is here to help you grow your business.

View Henley’s Bio on YouTube.